Published by Global Banking & Finance Review®
Posted on June 30, 2025
2 min readLast updated: January 23, 2026
Warner Bros bonds face delays in joining high-yield portfolios due to ICE index exclusion, affecting trading and investor interest.
By Matt Tracy
(Reuters) -A total $14.3 billion of media giant Warner Bros Discovery's bonds move to their new home in high-yield bond portfolios will likely be slowed by a recently announced exclusion from a major index, said a BofA Global Research report.
ICE Data Indices said on Thursday it would postpone including Warner Bros recently downgraded bonds on its ICE BofA High Yield Index, one of the major indices tracking U.S. junk-rated corporate bonds, until at least August.
The delay was because ICE was reevaluating its inclusion criteria after the recent downgrades and the impact of the debt buyback by Warner Bros earlier this month, an ICE spokesperson said in a written statement.
These factors "created uncertainty in the economic realities that the indices measure, which led ICE Data Indices to move forward in excluding the bonds from the rebalance," the ICE spokesperson wrote.
This delayed inclusion could prevent some investors buying the Warner Bros' bonds from those seeking to sell them out of their portfolios that had only high-grade debt, the BofA analysts wrote in their report.
The Warner Bros debt is expected to make up a little over 1% of the ICE BofA High Yield Index upon its eventual inclusion, the analysts said, adding that some 35% of high-yield bond portfolios are benchmarked to ICE.
A pause in trading of Warner Bros' bonds from June 11 to June 25, following the company's announced split-up into two separate publicly-traded companies and debt buyback, will also likely contribute to a delay in trading interest, the BofA analysts noted.
"This pause, combined with the index exclusion, could make it difficult for HY investors to buy near term, even as IG investors potentially look to sell following the rating agency downgrades in June," the analysts wrote.
ICE counterpart Bloomberg, however, is expected to include the Warner Bros bonds in its own junk bond index next month, according to the BofA report.
BofA said credit spreads, or the premium paid by companies over Treasuries, on 4.279% March 2032 bonds tightened 20 to 25 basis points in anticipation of being bought by high-yield accounts, but that this could be partially reversed.
Warner Bros did not immediately return a request for comment.
(Reporting by Matt Tracy; Editing by Shankar Ramakrishnan and Anna Driver)
ICE Data Indices announced the exclusion due to a reevaluation of its inclusion criteria following recent downgrades and the impact of Warner Bros' debt buyback.
The exclusion could hinder some investors from buying Warner Bros' bonds, especially those who typically hold only high-grade debt, as it creates uncertainty in the market.
Once included, Warner Bros' debt is expected to make up a little over 1% of the ICE BofA High Yield Index.
While ICE has postponed the inclusion, Bloomberg is expected to include Warner Bros' bonds in its junk bond index next month.
BofA reported that credit spreads on Warner Bros' bonds tightened 20 to 25 basis points in anticipation of being bought by high-yield accounts, indicating investor interest despite the delays.
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